The business behind the show

Hallmark Channel goes dark on AT&T television

Hallmark Channel pulled the signals of its two cable channels from the AT&T U-Verse system late Tuesday, less than two weeks before the launch of Hallmark's high-profile programming makeover.

The company, operated by Crown Media Holdings and controlled by Hallmark Cards, has been heavily promoting the Sept. 13 arrival of Martha Stewart on the Hallmark Channel. The style maven plans to provide eight hours of programming to the channel each weekday, replacing such classic programs as "I Love Lucy" and "Little House on the Prairie."

The action came as Crown Media, based in Studio City, and AT&T failed to reach a new carriage agreement. The sticking point was over how much AT&T would pay Hallmark Channel for the programming.

Hallmark declined to say how much it was seeking from AT&T for the right to carry its Hallmark Channel and the Hallmark Movie Channel. The previous pact expired at 9:01 p.m. Pacific Time (12:01 a.m. Eastern time Wednesday).

"We are the nation's family networks, and we will continue to produce quality programs that connect people emotionally," Bill Abbott, Hallmark Channel's chief executive, said in a statement announcing the blackout. The statement added that Hallmark would be willing to restart negotiations.

Until late Tuesday, the Hallmark Channel was available in nearly 90 million homes and the Hallmark Movie Channel was available in about 38 million homes. AT&T provides television service to about 2 million customers in the country. Dallas-based AT&T contends that Hallmark has been demanding AT&T pay more for the channels than what Hallmark charges "similarly-sized and smaller TV competitors."

"We want to reach an agreement that is fair to our subscribers and for all parties, as we have with numerous other content providers," AT&T said in a statement distributed last week after the discussions with Hallmark began to fall apart.